Proposal on Merger and Acquisition

2108 Words Jun 23rd, 2012 9 Pages
THESIS PROPOSAL
ON
IMPACT OF MERGER AND ACQUISITION IN NEPALESE FINANCIAL SECTOR FOR A BANK SURVIVAL

BY
SHUSIL RANA
MBA
ID: 5014/2010
KING’S COLLEGE
INTERNATIONAL AMERICAN UNIVERSITY
LA, USA

SUBMITTED TO:
RESEACRH COMMITTEE
KING’S COLLEGE, KATHMANDU NEPAL
INTERNATIONAL AMERICAN UNIVERCITY
LA, USA

May 9, 2012

Title of the study:

"IMPACT OF MERGER AND ACQUISITION IN NEPALESE FINANCIAL SECTOR FOR A BANK SURVIVAL ".

INTRODUCTION:

Commercial banks have an essential role in the economy. One of their main duties is to collect funds from excess fund sectors and lend to customers with insufficient funds. From these financial intermediary activities, they have an important role in determining the amount and distribution of credit in
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NRB has issued 21 directives for covering its prudential regulatory norms and the directives dealing with various aspects like capital adequacy, loan classification and provisioning, single obligor limit ,accounting policies and financial statements format, risk management, corporate governance, supervisory compliance, investment policy, submission of statistical reports, sales of transfer of promoter’s share, consortium financing, credit information/black listing, provision on CRR/SLR, branch expansion, interest rate, financial resources mobilization, deprive sector lending, KYC, SLF, etc. NRB regularly reviews the process by which BFIs assesses its capital, risk position, capital levels, and quality of capital as a part of its supervisory mechanism. It evaluates the degree to which a BFIs has in place a sound internal process to assess capital adequacy. NRB’s supervision emphasizes on the quality of the BFI’s risk management and internal controls. The process of regulatory supervision can involve any or combination of On-site examination or inspection, Off-site review, Discussion with management, Review of work done by external auditor, and periodic reporting. Despite all these prudential norms, regulation and supervision mechanism of NRB, the BFIs are facing the problems and are in verge of going out of the business. The adverse morale hazard has prevailed in Nepalese financial sector due to recent episodes of malpractices in a few

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